In 2019, PE-backed companies created more than 254,000 new jobs in Europe, with a total of more than 10.2 million people employed by just over 23,000 portfolio companies, spanning the full range from start-ups to SMEs to large multinationals. This corresponds to 4.3% of Europe’s active workforce. The growth was 5.5% above the previous year, far above the average job growth in Europe of 0.9%. These are the findings of the “Private Equity at Work” study, conducted for the second time by the industry association Invest Europe.
“Private equity is an essential part of the foundation on which the European economy is built“, says Eric de Montgolfier, CEO of Invest Europe. “Our data shows how the industry supports employment and generates jobs through investing in growth, innovation and sustainability across the continent. Private equity’s long-term, flexible patient capital is making a positive difference to European society and is essential to rebuilding the economy after the effects of COVID-19.“
The study also shows which sectors are particularly benefiting. For example, the ICT sector created 7% more jobs in 2019, followed by Biotech & Healthcare and Energy & Environment, which both grew by 6%. The large Consumer Goods & Services and Business Products & Services sectors, which each employ more than three million people in PE-backed companies, together created nearly 140,000 net new jobs in 2019.
Small and medium-sized enterprises, which form the backbone of the European economy, grew in particular thanks to investor support. A total of 15,278 private equity-backed SMEs employed 900,000 people across Europe at the end of 2019. These companies increased employment by more than 10% this year, with almost one in ten moving into a higher size category.
Read the full study here (first published on 27 May 2021).
The report marks Invest Europe’s second exhaustive study of private equity’s role in employment in Europe and captures an expanded group of companies. Over time, this data will expand to create a comprehensive picture of private equity’s contribution to jobs and the economy that those jobs support.